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482                 HISTORY OF PERSIA                 CHA?,
sterling was available to meet all the claims for arrears of
salary and on other accounts. The result was that the
first loan was very soon absorbed in totally unreproductive
expenditure, and in the following year a second loan was
contracted on the same security for 10,000,000 roubles, or
just over a million sterling. To the new loan was
attached a concession for a road from the frontier town of
Julfa on the Aras to Teheran via Tabriz. Certain rights
to work petroleum and coal were also acquired. These
m'ay prove to be of value when the conversion of the road
into a railway becomes an accomplished fact.
These two loans have been financially disastrous for
Persia. Her annual revenue at that period was about
;£ i, 500,000, and yet in three years, sums almost equal to
the revenue were borrowed and spent, with nothing in the
way of reproductive expenditure to show for them. Since
this date the debt of Persia has steadily increased, and
according to the latest statistics it has now reached 6£
millions. This sum is exclusive of nearly half a million
claimed for losses due to robberies.
The Belgian Customs Administration.—Twenty years
ago, .when I first visited Persia, the levying of customs
was as bad and as corrupt as any other branch of Persian
administration. Each important custom-house was
farmed by the Central Government to a wealthy notable,
or in some cases to a local chief. Customs were levied on
no system whatever, the usual method of procedure being
for the merchant to make a bargain with the farmer.
Europeans declined to pay more than the treaty 5 per
- cent, but native merchants, after bargaining at the port,
were freely taxed in the interior. To give some notion
of the conditions prevailing, I cannot do better than quote
an instance. Shortly after founding the Consulate at
Kerman, in 1895, I informed the customs farmer that the
Hindus, as British subjects, were not liable to any internal
dues, as they had paid the 5 per cent at Bandar Abbas.
My letter much upset the Persian official, who enquired
my authority. In reply I referred him to the treaty.
<c Treaty! " he exclaimed. " What treaty ! / have signed
no treaty !"